Report on Business Environment of TESCO
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Added on 2020-04-21
Report on Business Environment of TESCO
Added on 2020-04-21
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Running Head: Business Environment TESCOBusiness Environment
Business Environment 1Table of ContentsIntroduction......................................................................................................................................2About Tesco.....................................................................................................................................2Relationship of Tesco and Poland...................................................................................................3PESTLE analysis.............................................................................................................................4Political........................................................................................................................................4Economic.....................................................................................................................................4Social............................................................................................................................................4Technological...............................................................................................................................5Environment.................................................................................................................................5Legal.............................................................................................................................................5References........................................................................................................................................7
Business Environment 2Introduction Business environment can be referred to the combination of external and internal forces of thebusiness which influence the operations and profitability of the business. With the advent ofglobalisation, the organisations have begun to develop cross border relationships in order toimprove their position in the global market. Tesco, the largest supermarket of UK is one suchcompany which is operating in different countries in order to have global presence and to be atthe peak of the global retail industry (Tesco, 2018).About TescoTesco is the leading retailer of the world which works for millions of customers. The companyhave come a long way since year 1919 and works in countries like Poland, India, Malaysia,Ireland, Hungary and many more. The company is made in London and since then it hasdeveloped itself into a giant supermarket brand which rules the industry (Clark and Chan, 2014).The company recently faced its first annual profit drop in 20 year in 2013. The company also hadtough competition from the other emerging discounters like Aldi and Lidl. The company recentlyshowed 28% rise in its annual profits which were better than the expected growth (Butler, 2018).The main objective of Tesco is to serve the shoppers a little better every day by meeting theirneeds. They aim at providing easier way of living to its customers and to deliver best services tothem when they visit their stores (Tesco, 2018). The multinational retailer follows hierarchicalstructure as the organisation is huge which includes the top level, middle level and the base levelemployees who work in collaboration with each other. The top level have the CEO and board ofdirectors, middle level consist of the managers and heads of different departments and the baselevel employees are the workers and employees who work as per the instructions of the middleand top level management of the company. The company provides various products rangingfrom groceries, homeware to electronic items. The company wants to cover each and everysection of the society by providing them a wide range of products. The company also providesservices like Banking and financial services, telecommunication services and retail services tothe masses.
Business Environment 3Figure 1: Share of Leading Players in UK Food Retail MarketRelationship of Tesco and PolandIn 1994, Tesco launched their first international expansion. After that in 1995, Tesco entered inPolish market with the objective of further expansion in international market. Growth andsuccess of Tesco could be measured by its international expansion. Company always seeks newand emerging markets with an early growth stage in order to expand their business. This isbecause, new and emerging markets have weak and few competitors and the opportunity toacquire the market share and customer base is huge. Relationship amongst Tesco and Poland isquite old and strong. Main motive of Tesco in relevance with entering into Polish market was theinvestment incentives offered by Polish government to large companies. Polish governmentinvited all those companies who could invest more than £10 million (Peck, et. al., 2013). Thisattracted the Tesco due to their old policy of acquiring new and emerging markets with highgrowth opportunities. In return to the investment made by Tesco in Poland, Polish governmentoffered Tesco various grants such as employment grant, grants for infrastructure development,training grants, etc. Along with these grants, Tesco also faced political unrest which resulted incivil unrest and violent crimes. Violence and civil unrest is one of the major issues which Tescofaced in Far Eastern Europe (Rogers, Ghauri & George, 2005).It has been reviewed that in December 2001, an antitank missile hit the office of EL AL IsraelAirline. Later on, it was confirmed by the Thai authorities that the initial target was Tescobuilding which is adjacent to the EL AL Israel Airline building. Apart from the violence andcriminal activities, Tesco faced several religion related issues. In Poland, where most of thePopulation is of Roman Catholic belief and leftwing political parties accused Tesco hurting the
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